To apply for the tax credit, please contact an approved loan officer.
The following eligibility requirements apply to the MCC tax credit:
- Must be a first-time homebuyer, which is defined as not having owned a home in the past three years; this rule is waived if the property is located in a “MCC Target Area” (PDF)
- Annual borrower and co-borrower income limits are as follows: $81,400 for one to two persons, and $93,610 for 3 or more persons
- Must meet first mortgage lender’s criteria for underwriting, credit and down payment requirements with an approved MCC lender (see list below)
- Must occupy property as “principal residence” within 60 days of the purchasing the home
- Must complete a PHB-approved, HUD-certified homebuyer education course prior to loan closing
- Must be located within the Portland city limits (verify on www.PortlandMaps.com)
- Must remain owner-occupied to be eligible to continue taking the credit
- Must be for single-family units only, including condos and town homes
- Maximum purchase price is $454,177, city-wide
Fees & Other Requirements
PHB charges a $775 MCC Processing Fee for the program. The fee may be paid by the buyer or any other party to the transaction at loan closing. The homebuyer must obtain their first mortgage financing from an approved MCC Loan Officer. The MCC is compatible with a variety of loan types but it is not compatible with either the Oregon Bond or the Oregon Department of Veteran Affairs Loan programs. All loans must be fixed rate loans and the total fees charged by the lender must conform to PHB requirements. Each lender may treat the MCC differently for underwriting purposes and also depending on the type of loan selected. For details about the MCC programs consult one of the MCC Approved Loan Officers.
MCC Recapture Tax Disclosure
The MCC Program is designed to help low and moderate income households, therefore the program includes a federal Recapture Tax provision. The recapture tax is applicable if the property is sold for a profit within the first nine years of ownership. Payment of the recapture tax depends on MCC Holder’s adjusted gross income for the year in which they sell. MCC holders should consult their loan officer for details and carefully review the Recapture Tax Notice before applying for the program. MCC Holders should also familiarize themselves with IRS Publication 530 and IRS Form 8396 for details about claiming the MCC on their annual tax returns. For more information ask one of the MCC Approved Loan Officers or call PHB at 503-823-2375.